“It has taken me very long to publicly say I am an entrepreneur. I’ve always been a bit of a reluctant entrepreneur because it's a word that is abused a bit. It comes back to the way we run businesses and build a product. We are really just business builders.”
Jaco’s early career was etched in studious roles in investment and finance but he always knew he would move on to explore something of his own. He initially went on to pursue his MBA, thinking he would return to corporate life afterwards but that was not his fate. Having progressed to the final stages of interviews for a prestigious job at Microsoft New York, Jaco got close to securing what he thought would be his next career milestone but this didn't come to fruition. At the time Jaco saw this as a low blow, with a child on the way, the timing for disappointment not ideal, or so it seemed.
Jaco knew the state of the South African Job market, especially when it came to his level of expertise and maturity, was not very opportunistic. He understood the value of connections and his circumstances influenced him to spend more time reconnecting. Reunited with university friends Niel and Julian at ZAQ Actuaries, the trio began experimenting with some StartUp ideas. They had some resources through their consulting practice to explore their ideas, one of which came to life, in a big way. They developed a smart white labelled digital solution that enables pension and provident funds to improve member engagement, save time, reduce stress, and plan for a better future. A product that would experience uptake by leading businesses in the pension fund market and ignite success for these Founders.
So how exactly did they get to this place of success? Jaco teaches us a very important lesson about the transformation of an idea into a real life business. They did NOT start with building the product. They built a powerpoint presentation and wireframes of the proposed product. Then got a list of pension fund PO’s and they cold called at least half of the pension funds in the country and set up as many meetings as they could. They went on to pitch their digital solution and with each conversation, based on the feedback, tweaked things like pricing, features and so on, continuously refining as they sold. Then one day, they were met with the response: ‘We want to buy it, when can you deliver?’. Within six weeks the product was developed and delivered.
“To quote Reid Hoffman, if you’re not embarrassed by your first product, you’ve released it too late. Our first product was embarrassing but we started fixing bugs and problems immediately and within a few months we sold to another two big funds.”
Jaco shows us how he created an urgency with finding product-market fit and interest BEFORE investing in building the perfect product. What they achieved in a year was both a working product and first sales that quickly made their idea profitable. Having been burnt with overspending on ideas that never transition into real businesses, their rule of thumb is to reach proof of concept with minimum funds. Jaco’s ventures remain cash positive without having to raise funding, a real life example of how this philosophy to prioritise sales and distribution over product building, has real merit.
Opportunity and risk provides a great environment for new ideas - and Africa has a lot of that to take advantage of! Jaco encourages Founders to look at their own context when setting their goals. In the South African market for example, a Founder looking to raise funding and TAM (total addressable market) of that of their American counterparts, primes unrealistic expectations. He goes on to warn Founders looking to expand into international markets to do so with caution and good planning. From his experience, he advises Founders to make the move when they feel they are in a position of not being able to grow without making the move, as the funds required can far over exceed expectations not to mention the obstacles that come with highly developed and regulated markets.
“I became an entrepreneur because I had no other option really in the local market, which is the hard reality. Looking back, it's been a massive blessing. The ability to run my own life, to build interesting stuff, and to grow into understanding what you are really good at”.
As we build our business, discovering our strengths and weaknesses becomes a real advantage. Jaco has gotten to a point in his journey where he is crystal clear on what he is really good at: ideating, catalysing a project and getting the right people around the table, and working on new and interesting innovations. Running the day to day part of business is where Jaco brings in the experts to partner with.
His parting pearls of wisdom:
“Try to sell something before you spend money building stuff. If you can sell it, then figure it out from there.”
“Solving niche challenges Founders face”.
Illustrator: Lisa Williams (Instagram: @artist_llw)